The bicycle business is among the many key companies that regarded ahead to a lift because of the coronavirus pandemic. The countrywide lockdown imposed by the federal government to curb the unfold of the lethal COVID-19 illness initially triggered added demand for bicycles, that are some of the environment friendly methods to maneuver round whereas sustaining social distance. However, the conflict with Chinese forces in Ladakh during which 20 Indian troopers misplaced their lives has elevated considerations for Punjab, a bicycle-manufacturing hub which depends on China for components.
If India’s bicycle-part imports dry up, it might imply an enormous setback for the Rs 7,000-crore business, except the federal government steps in.
Being the most secure mode of journey within the present state of affairs which warrants social distancing, the standard bicycle abruptly noticed a spike in demand when the federal government started to unlock an economic system already slowing down even earlier than the coronavirus outbreak.
The rising reputation of bicycles had market chief Hero Cycles eyeing a leap in its market share to 50 and even 60 per cent from 40 per cent.
“Those who are not going gym are opting for cycling. The demand has increased. Earlier, we manufactured 18,000 cycles per day, and this has now increased to 20,000 cycles per day,” stated Pankaj Munjal, chairman and managing director, Hero Cycles.
However, the India-China border tensions have affected that optimism. In the bicycle-making hub of Ludhiana, 70-76 per cent of the components used come from China.
Local micro, small and medium enterprises (MSMEs), which additionally manufacture the parts, are nonetheless recovering from the COVID-19-induced lockdown, and in no place to fill the hole that an finish of imports from China could go away.
“Our production is just 20 per cent since the industry has been hit due to the lockdown… the labourers were allowed to leave to their native places… The government has not given us any tax rebates,” stated Gurmeet Singh Kulhar, president, Federation of Industrial and Commercial Organization.
“Moreover, we had to bear the expenses of our labourers during this period… We had to even pay foxed charges of electricity, property tax and other similar charges,” he added.
Punjab accounts for 92 per cent of the entire manufacturing of bicycle components for the nation, which makes 18 million bicycles every year, and 75 per cent of bicycle manufacturing.
The business is clutching in any respect doable straws.
The share of imports of bicycle and components from China diverse from 70 per cent to 76 per cent within the whole within the final 5 years.